I am a strong supporter of the use of renewable, environmentally friendly fuel sources such as ethanol and biodiesel and research into how to make those sources more efficient and available.  In 2003, Senators Coleman, Harkin, Lincoln and I created the Senate Biofuels Caucus.  This bi-partisan group was established to provide a forum for senators interested in working together to support policies that promote the use and development of renewable fuels. 

In the Energy Committee, Senator Tim Johnson (D-S.D.) and I successfully added a bipartisan amendment to the Energy bill to add the largest Renewable Fuels Standard ever considered by Congress. The full Senate overwhelmingly approved our amendment by a 70-26 vote.  Renewable fuels are at the heart of economic growth and jobs for the future; at the heart of energy independence from foreign energy producers; at the heart of environmental quality; and at the heart of value-added agriculture for our family farmers and producers.

Increasing the production and use of ethanol and biodiesel will directly increase fuel supplies, and reduce our dependence on foreign oil.  In addition, renewable fuels promote rural economic development while ensuring cleaner air and a cleaner environment.

American farmers have clearly demonstrated their ability to build a more secure energy future for the U.S.  Over the past three years, the ethanol and biodiesel industries have expanded production to meet our nation’s rising needs by turning corn and soybeans into fuel that can be used in cars on the roads today. I strongly support the growth of these industries and want to promote policies that support value-added agriculture.

The new energy law includes the following renewable fuels initiatives that I sponsored:

7.5 Billion Gallon Renewable Fuels Standard

Working with Senate Energy Committee Chairman Pete Domenici (R-N.M.), I helped negotiate the Renewable Fuels Standard which would add 7.5 billion gallons of ethanol, biodiesel and other renewables to the nation’s fuel supply by 2012.

E-85 Tax Credit

Senator Barack Obama (D-Ill.) and I added legislation to the energy bill, now law, to increase the availability of fuels blended with 85 percent ethanol. The legislation provides a tax credit incentive of 30 percent through 2008 for switching one or more traditional petroleum pumps to E-85 fueling systems. E-85 is a blend of 85 percent ethanol and 15 percent petroleum gasoline.

Biodiesel Tax Credit Extension

Senator Blanche Lincoln (D-Ark.) and I successfully added a measure, now law, extending through 2010 the $1.00 per gallon biodiesel tax credit designed to make soybean-based biodiesel fuels cost competitive with conventional diesel fuel. I also worked on this initiative with Congressman Kenny Hulshof (R-Mo.) who was the chief sponsor of the companion legislation in the U.S. House.

Small Producer Tax Credit

Senators Lincoln and I also added a provision, now law, expanding the ten-cent-per-gallon small ethanol producer tax credit to those who produce up to 60 million gallons annually and establishes the tax credit for small biodiesel producers that make up to 60 million gallons of biodiesel per year.